Spike

Getting a tremendous boost from the addition of nearly 900 MMcf/d in takeaway capacity, Rockies gas led an overall moderately strong beginning of the April aftermarket with jumps of more than a dollar in most cases Wednesday. San Juan-Blanco numbers also saw sizeable upticks of more than 60 cents, while non-Rockies points ranged from about a nickel to a quarter over end-of-April levels.

As NGI sources had suspected the day before, the cash market couldn’t keep rising indefinitely without visible means of support. Sure enough, eastern prices finally reacted Thursday to the one-two punch of weakening futures and only a modicum of weather-related demand by registering declines that were mostly in the vicinity of a dime but ranged from about a nickel to a little more than 20 cents.

With its primarily coal-fired fleet of power plants, American Electric Power (AEP) stands to gain from the recent surge in natural gas prices, a top executive with the Ohio-based electric power company told an audience of investment professionals on Wednesday.

An initial review undertaken by the Federal Energy Regulatory Commission suggests the spike in natural gas prices in the Northeast and elsewhere this week was “fundamentally driven” by market forces, rather than abusive practices, said the head of the agency’s Office of Market Oversight and Investigations (OMOI) Wednesday.

The 10-cent spike in March futures in the face of softer holiday weekend demand at most locations was enough to help cash prices manage gains of about a nickel on average and much more in the Northeast, which was expecting severe cold on Saturday and Sunday.

Building on Thursday’s screen spike, forecasts of severe weather over the weekend across much of the Midwest and Northeast, and anticipation of even greater heating load to arrive later this week, cash prices made another strong surge Friday. Double-digit gains were the order of the day for a majority of points; however, Rockies quotes retreated between about a dime and a quarter.

Bullied by sudden and seldom-seen agreement between private and governmental weather forecasting agencies last week, natural gas futures spiked 40-50 cents higher Wednesday evening and Thursday as traders initiated long positions that they had liquidated over the past several weeks.

Bullied by sudden and seldom-seen agreement between private and governmental weather forecasting agencies, natural gas futures spiked higher Wednesday evening and Thursday as traders initiated long positions they had liquidated over the past several weeks. Nymex reopened with a bang at 7 p.m. EST Wednesday evening as prices rebounded more than a dime off Tuesday’s $4.789 close.

Given a solid launch by the previous day’s futures spike and ice storms along the northern half of the East Coast, prices recorded double-digit gains at nearly all points Wednesday. With the exception of a few flat to moderately lower Northeast citygates, increases tended to range from about a dime to 30 cents, with most of them in the 20s.